French lawmakers have approved a proposal requiring individuals holding at least €100,000 ($112,000) in self custody cryptocurrencies to declare their assets to tax authorities or risk fines of up to €10,000.
Summary
- French lawmakers have backed a proposal requiring individuals with at least €100,000 in self custody crypto holdings to declare their assets annually.
- Failure to report qualifying cryptocurrency holdings could result in fines of up to €10,000 under the proposed amendment.
- Lawmakers cited concerns over tax evasion after a parliamentary inquiry found a large gap between crypto capital gains and declared holdings in 2021.
- The Finance Committee approved five crypto related amendments, including proposals addressing stablecoin taxation and an exit tax on large holdings.
- The measures still require parliamentary approval after the committee rejected the revenue section of the proposed 2027 budget.
According to amendment I-CF821, adopted by the French National Assembly’s Finance Committee on Friday, the proposed requirement would cover digital assets held outside regulated crypto service providers, including cryptocurrencies stored in personal wallets.
The measure would introduce a new provision into France’s general tax code, requiring eligible holders to report the value of their assets as of December 31 each year.
Failure to submit the required declaration could result in a penalty reaching €10,000. However, the proposal has not become law and must receive further parliamentary approval before the reporting requirement can take effect.
Charles de Courson, Jean-Pierre Bataille and Michel Castellani, three lawmakers from the Liberties, Independents, Overseas and Territories parliamentary group, introduced the amendment as part of the country’s 2027 budget discussions.
France targets undeclared crypto holdings
The proposal focuses on cryptocurrencies held without an intermediary, where individuals maintain control of their assets through personal wallets instead of relying on a crypto exchange or custody provider.
According to the amendment’s sponsors, the reporting requirement is intended to address tax evasion involving digital assets that may not appear in information submitted by regulated financial institutions.
Lawmakers cited findings from a parliamentary inquiry into the taxation of wealthy individuals to support the proposal.
The inquiry found that cryptocurrency capital gains reached €3.5 billion in 2021, while taxpayers declared only €400 million in cryptocurrency holdings to French tax authorities during the same year.
The figures cover different categories of crypto activity, with capital gains representing profits from asset disposals and declared holdings representing reported assets.
The sponsors used the findings to support requiring individuals with substantial cryptocurrency holdings to disclose assets kept outside crypto service providers.
A €100,000 threshold would determine which holdings fall within the proposed declaration requirement. The amendment uses the value recorded on December 31 as the reference point for reporting.
The measure concerns disclosure of holdings, not a proposed ban on personal wallets or a requirement to transfer assets to regulated custodians.
France has separately been preparing to collect more information about cryptocurrency transactions through the European Union’s DAC8 tax reporting framework.
France considers other crypto tax changes in 2027 budget
The wallet disclosure amendment was among five cryptocurrency-related proposals approved by the Finance Committee during its review of the 2027 budget.
In a separate development, crypto.news previously reported that French lawmakers had backed changes to stablecoin taxation alongside proposals addressing cryptocurrency trading losses and taxation when investors relocate abroad.
One amendment, I-CF1826, submitted by Nicolas Sansu, would make conversions from cryptocurrencies into qualifying electronic money tokens taxable beginning January 1, 2027.
Existing French tax rules generally allow eligible exchanges between cryptocurrencies to take place without immediately triggering capital gains taxation.
The proposed amendment would change that treatment for qualifying stablecoin conversions, subject to final approval of the legislation.
Investors holding cryptocurrencies acquired before January 1, 2027, would have options for calculating their acquisition costs, including using documented purchase prices or an allocation based on portfolio values at the end of 2026.
Another amendment, I-CF798, submitted by Daniel Labaronne, would allow qualifying cryptocurrency trading losses to be carried forward and deducted from future gains for up to 10 years.
France currently has a separate framework for deducting eligible crypto losses, and the proposed change would give investors a longer period to use those losses against taxable gains.
Lawmakers considered an exit tax covering certain unrealized cryptocurrency gains when taxpayers move their tax residence outside France.
Amendment I-CF1822, submitted by Sansu and approved by the committee on October 8, targets qualifying cryptocurrency holdings exceeding €800,000.
France already applies exit tax provisions to certain financial assets when eligible taxpayers relocate abroad. The amendment would bring qualifying digital asset holdings within the relevant tax treatment.
None of the committee-approved cryptocurrency tax amendments has received final parliamentary approval.
Crypto reporting requirements face legal scrutiny
France’s proposed wallet declaration requirement comes as European tax authorities implement reporting obligations for cryptocurrency service providers under DAC8.
The European Union’s framework began applying on January 1, 2026, requiring covered providers to collect information about customers and qualifying cryptocurrency transactions.
Reporting obligations include transfers involving self custody wallets when transactions pass through covered crypto service providers.
The framework requires companies to collect identifying information, including customer names and tax identification numbers, alongside relevant transaction records.
Information collected during 2026 will form part of the first reporting cycle in 2027, with tax authorities expected to exchange covered data by September 30, 2027.
France has faced legal challenges over its implementation of the European reporting rules.
In September, the country’s Council of State rejected an emergency challenge brought by cryptocurrency companies Bull Bitcoin and Paymium against the French decree implementing DAC8.
The companies had sought to suspend the decree while a separate legal challenge continued. Bull Bitcoin raised concerns about security risks associated with collecting and centralizing personal information about cryptocurrency users.
The court found insufficient urgency to suspend the rules through emergency proceedings, leaving the separate request to annul the decree unresolved.
France’s cryptocurrency tax reporting activity has attracted attention following estimates of potentially taxable transactions involving French users.
A September analysis by Chainalysis estimated that France generated $9.4 billion in crypto activity that could fall within taxable categories during 2025.
The estimate included $1.7 billion in cryptocurrency income, $2.5 billion in realized gains and $5.2 billion in payments across six blockchains examined by the analytics company.
Chainalysis cautioned that the figures represented potentially taxable economic activity, not unpaid taxes or revenue owed to the government.
French taxpayers had declared €368 million in cryptocurrency capital gains for 2024 through approximately 24,000 tax filings, according to figures cited in the analysis.
French crypto tax proposals await parliamentary debate
Despite approving the wallet disclosure amendment and other cryptocurrency tax proposals, the National Assembly’s Finance Committee subsequently rejected the revenue section of the government’s proposed 2027 budget.
The committee voted 31 to 3 against the revenue provisions, leaving the amendments without a committee-approved budget text to advance.
Lawmakers are scheduled to begin debating the revenue section in the National Assembly on Tuesday, October 13, using the government’s original draft as the starting point.
The cryptocurrency amendments must be introduced again during parliamentary proceedings and secure the necessary votes before they can be included in the final legislation.
French technology publication Clubic reported that the committee’s earlier approval would not automatically carry the amendments into the budget following the rejection of its revenue section.
The next stage of parliamentary debate will therefore determine whether lawmakers resubmit the €100,000 wallet disclosure proposal and the other cryptocurrency tax measures for consideration.
